Timeshare

Be sure to know all the facts before buying resale timeshares.

(Whereas the following information is geared toward those buying timeshare on the resale market, anyone selling timeshares should pay attention. If you plan on selling your timeshare, know that smart buyers will ask questions along the lines of the information presented below. I would encourage anyone selling timeshare to answer questions candidly and honestly.)

While it is true that timeshare resales cost much less than timeshare bought directly from a resort developer, you still need to make sure you’re getting what you want out of the deal when buying a resale timeshare. 

Here are some important points for timeshare buyers to consider:

1. One of the first questions that we ask to a prospective advertiser is whether or not the maintenance fees and property taxes have been paid up-to-date. The answer to this question could mean a difference of several thousand dollars in the total cost to the timeshare buyer. Make sure you know the whole cost before you buy.

2. As we all know, buying anything sight-unseen can sometimes bring unexpected results. For this reason, some timeshare owners like to see the actual timeshare unit in person before they sign paperwork.

3. For timeshares that are affiliated with an exchange company, find out if this membership can be transferred. This may save you a lot of hassles later on. This applies to points-system timesharing too. Find out if these points are transferable! Also, be sure that the bonus weeks or any other extras included in the purchase price of your resale timeshare can be transferred.

4. Find out the reason why the timeshare is being sold. This is an important consideration for any buyer.

5. Often, the seller pays to advertise the property while the buyer pays the closing costs. Find out what charges you will be responsible for when the sale closes.

6. Some timeshare units are inevitably located in a facility that has been partially remodeled. Make sure you’re not paying a new-unit price for an old, beat-up timeshare.

7. Has the timeshare been used this year? This is especially important when dealing with an odd-or even-year-use timeshare. It might be two years before you can actually use your timeshare. In the case of right-to-use timeshares, the lease on such property is usually only good for a certain number of years. Be sure to find out how much time is left on the lease.

I hope that those considering a timeshare purchase would ponder these seven points. These timeshare tips could save a lot of grief in the long run.

Beware of timeshare resale companies that refuse to disclose their location. If they won’t post their physical address on their site, or if they hide behind a PO Box… they’re probably up to no good!

(Author’s note: for the purposes of today’s post, I’ll be using the term “transparency“. According to business-in-asia.com’s Business Glossary, “transparency” is defined as:

“The concept of making trade-related administrative processes easier to follow, including opening them to public scrutiny and subject to clear methods of challenge or amendment.”)

As stated in earlier posts, my goal for this weblog is to provide quality timeshare tips and advice for timeshare owners instead of promoting my own company. However, for today’s post, I would like to use my own company as an example to make a few observations about the current state of the timeshare resale industry.

I’ve often remarked that the timeshare industry is changing for the better. When big hotel brands entered the timeshare marketplace over a decade ago, these ushered in an era of greater accountability and honesty in the timeshare business. True, this multi-billion dollar industry attracts its share of scammers, but so does any other lucrative business. Essentially, the entire industry is undergoing a massive change in business practices, from the top down.

Though corporate policy is decided at the highest level, it can take a while for all these changes to filter down to the base of the pyramid, where most timeshare owners feel the difference. This is why, even while the entire industry is reaping the long-term rewards earned by years of sound business practices, it is an ugly fact that the timeshare resale sector has been the one segment of the industry LEAST receptive to these positive changes. Each day ARDA and other groups within the timeshare industry are taking new measures to put an end to “antiquated” high-pressure timeshare sales tactics. At the same time, hundreds of boiler-room operations across the world dazzle their prospects with false promises, badger their victims when they don’t rise to the bait, and eventually take the money and run.

Timeshare owners and resale companies have at least one thing in common: we’re both sick and tired of the deceptive practices in the timeshare industry. As a resale company, we compete with some of the most nefarious scam artists this side of organized crime. It frustrates me that these people actually get a share of the timeshare resale market while at the same time dragging the entire industry through the mud.

It is time to put an end to these lousy business practices once and for all. One way we can do this is to educate first-time timeshare buyers about the timeshare industry. Common sense dictates that a well-educated consumer is much harder to scam. The same consumer will inevitably respond well to honesty and fair treatment. This mode of thinking has caught on in some circles of the timeshare sales community, and I think that it is time to apply it to the resale sector too.

Another way to promote better business practices is through integrity, transparency, and honesty. For instance, a timeshare company that refuses to disclose its physical location probably has reasons for being duplicitous. If a company does not post its physical address on its website, or hides behind a post office box, there’s probably something funny going on. Maybe it’s a one-man operation conducted from a basement somewhere. We’ve all heard stories about fraudulent “businesses” based out of a cell in a maximum-security penitentiary. The bottom line is, if something that claims to be a timeshare resale company will not give out its actual physical location, do not give it any money!

In summary, transparency is the order of the day. It is the only way for a company to attain any degree of credibility in the modern age. This is especially true of online businesses, who by their nature can be subject to the scrutiny of millions of people all over the world at any time. Our business model is centered around long-term success in a modern business climate. Not only for ourselves, but also for our advertisers. It is in our best interests as a company to provide openness and accountability to both potential clients and long-term advertisers.

Points-based timeshare ownership offers owners more flexibility, but there are some things about points systems that any timeshare owner should know.

The concept of points-based vacation ownership is one of the most significant innovations within the timeshare industry in recent years. The goal of this article is to illuminate some of the pros and cons frequently encountered by timeshare owners who buy into a points-based system of timeshare ownership.

First of all, timeshare owners who buy points often do not own them. Most resort chains/exchange companies hold these points in trust. This can pose advantages and disadvantages depending on the owner’s particular needs and preferences. There are some exceptions to this statement, but by and large this is the case.

Points can be redeemable for a number of things, including airfare, hotels, and car rentals. Whereas this is an obvious convenience, points owners can expect to pay fees each time they use their points. For example, using points for plane tickets, renting a car at the airport, and staying overnight at a hotel could cost about $100.00 in accumulated fees.

Possibly worst of all, inflation often occurs with timeshare points. For example, if you have 150,000 points, you might be able to exchange these for a particular resort this year, but what about next year, when the resort you want suddenly costs 200,000 points?

Also, there may be additional restrictions imposed on the transfer of points between owners. This might make things difficult on the resale market. It is best to ask the timeshare seller or the home resort about any restrictions regarding the sale of timeshare points.

Though some difficulties arise, a points-based timeshare allows very flexible vacationing. Herein lies the real beauty of this type of ownership. Stay for as little or as long as you want! Points allow much greater freedom in determining a vacation itinerary.

Again, timeshare points can also be redeemed for a number of important vacation necessities, like hotel rooms, auto rentals, and airfare. Some theme parks even accept points toward tickets to their attractions.

Like everything else in the world of timeshare, a shrewd timeshare owner will learn how to benefit from these opportunities.

Thanks to Honolulu city and county officials, timeshare owners on Hawaii could experience as much as a 50% increase in yearly costs.

Hawaii has long been considered the Holy Grail of vacation destinations. With everything that these islands offer, it’s no surprise. However, some recent changes to the Big Island’s tax laws are leaving a bad taste in the mouth of many timeshare owners.

Following last year’s decision by Maui to create a new category of taxable property called “timeshare”, the Big Island’s local government recently announced its decision to follow in Maui’s footsteps by unveiling a new tax on timeshare property. This new tax, known as the TAT, for Transient Accomodations Tax, is assessed based on the “fair market value” of a timeshare property. Strangely, “fair market value” is determined in this case NOT by the price a timeshare property could fairly command on the market, but rather by “an amount equal to one-half the gross daily maintenance fees that are paid by the owner.” However, if the timeshare is rented out on a nightly basis by the owner, the tax on the timeshare is assessed based on the value of the gross income of the rental unit. Timeshare units, categorized as such, are taxed differently than hotel property. But what happens to a hotel that offers some of its units on a time-sharing basis?

Reportedly, local lawmakers have earmarked a share of the revenue produced by this tax for the purpose of marketing Hawaii as a vacation destination. Granted, much of this tax goes toward the upkeep of public facilities used by timeshare owners, but one is forced to wonder why a timeshare owner ought to pay for marketing and promotions when he/she already owns at least one timeshare in Hawaii.

These new laws are raising some eyebrows in the timeshare-owning community. Many people feel that Honolulu city and county legislators ought to reconsider some of the ramifications of this new legislation.

If you own timeshare in Hawaii, you are strongly encouraged to contact your home resort or the appropriate local government agency for more information about these changes, and how they will affect you or your timeshare.

(More information on this subject and other news from Hawaii’s Big Island can be found at the Hawaii Reporter. Here is a link to their article.